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CHICAGO - Methode Electronics, Inc. (NYSE:MEI), currently trading slightly below its InvestingPro Fair Value with a market capitalization of $365 million, reported record sales for power distribution products for data center applications in the fourth quarter and full fiscal year 2025, despite posting an overall net loss of $28.3 million or $0.80 per diluted share for the quarter ended May 3, 2025.
The company’s fourth-quarter net sales were $257.1 million, down from $277.3 million in the same period last year. The decrease was primarily attributed to lower volume in the Automotive segment due to previously disclosed program roll-offs, partially offset by higher volume in the Industrial segment driven by data center applications. According to InvestingPro data, the company maintains a solid financial health score of 2.09, despite recent challenges. Subscribers can access 12 additional key ProTips about MEI’s performance and outlook.
Methode’s data center power product sales reached over $80 million for the fiscal year, marking a record performance in this segment. The Industrial segment saw net sales increase 13.1% to $132.6 million in the fourth quarter, compared to $117.2 million in the same period last year.
The company reported positive free cash flow of $26.3 million for the quarter, its highest since fiscal 2023. Total debt decreased to $317.6 million from $327.9 million in the third quarter, while net debt reduced to $214.0 million from $224.1 million. The company maintains a healthy current ratio of 2.84, indicating strong ability to meet short-term obligations.
"The Methode transformation journey made further progress in the quarter, as we focused on improving execution to drive long-term value," said President and Chief Executive Officer Jon DeGaynor in the press release statement.
For fiscal 2026, Methode expects net sales between $900 million and $1 billion, with EBITDA projected to improve over 100% to a range of $70 million to $80 million. The company anticipates stronger performance in the second half of the fiscal year.
The Board of Directors declared a quarterly dividend of $0.07 per share, payable on August 1, 2025, to shareholders of record as of July 21, 2025. Notable for income investors, MEI offers a significant 5.39% dividend yield and has maintained dividend payments for 44 consecutive years, demonstrating strong commitment to shareholder returns.
The company noted challenges including reduced demand from a major electric vehicle customer and inventory write-downs related to reduced, delayed, or canceled programs. Electric and hybrid vehicle applications represented 20% of net sales in the fourth quarter.
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